Copper dropped before FOMC minutes and ADP Employment Change. At Multi Commodity Exchange the metal for January contract fell by 0.35% and settles to ‚465 at GMT10:57. The metal rose above ‚467 from ‚463 on inventory fall at LME. Low inventory was monitored even at New York and Shanghai exchanges.
The commodity is expected to fall as US economy has given continuous indications of improvement. The metal was gaining last year because easing had kept dollar weak. Strong USD may weak the metal prices in the market. US is the second largest importer of metals after China.
Fed has already announced asset purchase cut by $10 billion on Dec, 18 that will be implemented from this month. Fed may wind up the stimulus program by the end of this year that may further deepen the metal prices.
Upcoming Nonfarm Employment Change and Unemployment Rate on Friday, indications Fed is looking after, are likely to improve which is negative sign for the copper investors. At China high funding cost may reduce demand for copper. Overall we may see bearish trend till the end of this week.
In other base metals Nickel and Aluminum are down while Zinc and Lead are up by 0.24% and 0.04% respectively.